ByScott PendletonMay 27, 1992

Exxon Company U.S.A., the domestic-focused division of the global oil giant, will terminate more than 1,000 employees by Aug. 1. The reduction will hit hard in "the oil capital of the world," home of Exxon U.S.A.'s headquarters and half of its 20,000-member work force.

"Our executives tell us privately that they don't see anything but more of the same in the future," says a manager who expects to survive this cutback and to retire before the next one.

Dr. Smith notes that as the far-flung domestic oil industry shrinks, it often relocates consolidated operations to Houston, maintaining the city's petroleum preeminence. Nonetheless, in terms of jobs, "we're a net loser; there's no question," he says.

One company, however, hired 1,000 employees in 1991 through its Houston subsidiary. This year it seeks another 500.

Last week, at the subsidiary's twin office towers southwest of downtown, a score of new hires and their spouses attended an orientation session. The group laughed at one bit of feedback the staff had received from an earlier recruit. "You didn't tell me there were going to be so many Arabs here," the new employee of Saudi Aramco had remarked.

In fact, 75 percent of the top positions at Saudi Arabia's national oil company are filled by Saudi citizens. And 55 nationalities are found among the company's 50,000 employees.

Many recruits already know that; up to half the participants in the weekly orientations are former employees of Saudi Aramco. George Haddad and Tom Thorstenson in last week's group had worked in Dhahran for 10 and 14 years, respectively.

When Saudi production hit a 16-year low of 3 million barrels per day in 1985 and oil prices crashed the following spring, the company downsized and the two men found work elsewhere. Now Saudi Aramco needs their skills again as it expands production capacity to 10.5 million b.p.d.

That figure isn't a production target, say executives at Aramco Services Company (ASC), the Houston subsidiary, but rather a margin of flexibility that takes time to build.

"During the war they ran everything flat out and they got above 8.5 [million b.p.d.]," says ASC spokesman William Tracy. "But it put a great strain on the system. They couldn't have done it indefinitely."

ASC looks for recruits with "cutting-edge technology" skills to send to Dhahran. Those who qualify will earn an amount equal to their US salary plus another 30 percent that is tax-protected. "If you're going to earn extra money, you shouldn't have to lose some of it in extra taxes," Mr. Tracy explains.

For Jim Jackson and Tim Habib, the better pay is perhaps secondary to the lure of steady work. Mr. Jackson quit Chevron's refinery in Port Arthur, Texas, not long before the company closed it. "We were always being told how uncompetitive we were," he says.

Mr. Habib, a field geophysicist, has been a consultant since being laid off by Mobil five years ago. "I'm glad to be getting back to the security of a big company," he says.

ASC recruiter Sam Wright ends the orientation by asking the new employees to encourage friends to apply at Saudi Aramco. He says: "We're looking for good, quality people." In other words, the sort of people that every other oil company in Houston is letting go.